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House Approved TRID Safe Harbor Bill Moves to Senate
Thursday, October 8, 2015 6:50 AM

The U.S. House passed a bill to establish a hold-harmless period for the Truth in Lending Act-Real Estate Settlement Procedures Act integrated disclosure (TRID) rule through Feb. 1, 2016, by a 303-121 vote. All Republicans and 64 Democrats supported it, and the bill passed by a much wider margin than some anticipated.

The CUNA-supported bill would protect mortgage stakeholders making a good faith effort to comply with TRID from enforcement and litigation during the hold-harmless period.

“This legislation is important for credit unions as they work in good faith to comply with the TRID rule, which became effective Oct. 3,” said Ryan Donovan, CUNA chief advocacy officer. “CUNA and other stakeholders repeatedly asked the CFPB to provide a formal hold-harmless period to ensure the rule has minimal impact on consumers and residential home mortgage closings. We thank the House for their quick action on this important issue and urge the Senate to do the same.”

The bill’s sponsor, Rep. French Hill (R-AR), said the bill was introduced because of a lack of clear guidance from the CFPB; the stories he and his colleagues have heard regarding efforts to comply; and lingering uncertainty on several aspects of the rule.

In addition, though stakeholders in many cases have spent more than a year putting in place new systems and procedures, they could not become compliant nor test their systems to gauge their compliance before the effective date.

The bill's co-sponsor, Rep. Brad Sherman (D-CA), said the bill would help ensure access to mortgage credit during the hold-harmless period, because it would allow small lenders to work toward full compliance without penalty.

CUNA's Donovan noted after the strong vote, "We at CUNA, in cooperation with our league partners, worked tirelessly throughout the year to help Congress understand why this bill is necessary and important. Credit union advocates talking about this on Hike the Hill visits helped carry this across the line in the House."